Last month, Toyota Viet Nam unveiled the recommended retail prices for its first shipment of cars imported from Indonesia at zero tax, and most of them are higher than before the policy of zero tariffs took effect. — Photo kienthuc.vn Last month, Toyota Viet Nam unveiled the recommended retail prices for its first shipment of cars imported from Indonesia at zero tax, and most of them are higher than before the policy of zero tariffs took effect. The imports include Fortuner, Hilux and Hiace. The lowest price for a Fortuner SUV is VND1.026 billion (US$44,609), VND45 million ($1,957) higher than the rate in late 2017. Three versions of the Hilux cost VND695 million, VND793 million, and VND878 million. Earlier, more than 2,000 Honda cars were imported from Thailand, the first batch to be subject to 0 per cent duty under the ASEAN Free Trade Agreement (AFTA) that took effect this year. The Jazz, Accord, CR-V and Civic models also saw prices higher than expected. From July 1, the … [Read more...] about Zero tariffs fail to translate into cheaper cars
Why should we pay tax to the government
For Vietnamese, zero tariff fails to translate into cheaper cars
Last month, Toyota Việt Nam unveiled the recommended retail prices for its first shipment of cars imported from Indonesia at zero tax, and most of them are higher than before the policy of zero tariffs took effect. — Photo kienthuc.vn Compiled by Thiên Lý Last month, Toyota Việt Nam unveiled the recommended retail prices for its first shipment of cars imported from Indonesia at zero tax, and most of them are higher than before the policy of zero tariffs took effect. The imports include Fortuner, Hilux and Hiace. The lowest price for a Fortuner SUV is VNĐ1.026 billion (US$44,609), VNĐ45 million ($1,957) higher than the rate in late 2017. Three versions of the Hilux cost VNĐ695 million, VNĐ793 million, and VNĐ878 million. Earlier, more than 2,000 Honda cars were imported from Thailand, the first batch to be subject to 0 per cent duty under the ASEAN Free Trade Agreement (AFTA) that took effect this year. The Jazz, Accord, … [Read more...] about For Vietnamese, zero tariff fails to translate into cheaper cars
How to understand the essence of unobserved economy
Nguyễn Bích Lâm. — Photo quanhta.com Nguyễn Bích Lâm, director general of the General Statistic Office, from the Ministry of Planning and Investment, speaks to Vietnam News Agency magazine Kinh tế Việt Nam & Thế giới (Việt Nam and the World) on the true meaning of the concept of an unobserved economy. What is the concept of unobserved economy? An unobserved economy is an economy that reflects the performance results of all economic entities in society but who’s performance has not been officially collected. This economic entity is comprised of a number of elements: First, it is the informal economy which is all legal business operations but without official registration with the authority to avoid paying income tax, value added tax and other required duties to the State. Second, it relates to all illegal economic activities, including drug trafficking, prostitution activities and unregistered business … [Read more...] about How to understand the essence of unobserved economy
Vietnam’s fuel tax hike proposal could set fire of resentment
Recently, the Ministry of Finance proposed a fuel tax hike in order to “reduce emissions” and “pay off national debts.” If passed, the hike would increase the current environmental tax rates for petroleum and diesel to the highest level permitted for fuels, at VND4,000 ($0.18) per liter. Every morning, I commute to work on my old, trusty Yamaha-brand motorbike. Every week, I stop by gas stations twice to buy four liters of gasoline for my bike. If the fuel tax hike proposal is passed, I would have to spend an extra VND16,000. Every month, VND64,000 would go from my pocket into the national budget. It’s not about the money. VND64,000 is only worth about three cups of coffee or two bowls of pho, though I have to I admit that paying taxes is nowhere near as fun as drinking coffee or eating pho. But look at what’s happening right now. My neighborhood is still infested with trash. Thick clouds of dust rise from the ground as cars and motorbikes rush down … [Read more...] about Vietnam’s fuel tax hike proposal could set fire of resentment
Vietnam’s latest tax hike proposal could fuel resentment
Recently, the Ministry of Finance proposed a fuel tax hike in order to “reduce emissions” and “pay off national debts.” If passed, the hike would increase the current environmental tax rates for petroleum and diesel to the highest level permitted for fuels, at VND4,000 ($0.18) per liter. Every morning, I commute to work on my old, trusty Yamaha-brand motorbike. Every week, I stop by gas stations twice to buy four liters of gasoline for my bike. If the fuel tax hike proposal is passed, I would have to spend an extra VND16,000. Every month, VND64,000 would go from my pocket into the national budget. It’s not about the money. VND64,000 is only worth about three cups of coffee or two bowls of pho, though I have to I admit that paying taxes is nowhere near as fun as drinking coffee or eating pho. But look at what’s happening right now. My neighborhood is still infested with trash. Thick clouds of dust rise from the ground as cars and motorbikes rush down … [Read more...] about Vietnam’s latest tax hike proposal could fuel resentment
Condotel—the future of the real estate industry
Michael Piro, director of Strategic Services Can you share with us your general opinion about the potential and prospects of condotel development in Vietnam? There is tremendous opportunity for condotel products in Vietnam. Condotels typically find themselves on resort properties, a holiday destination option that has become increasingly popular in Vietnam. If you look the country, it has a more than 3,000km of coast line, so naturally you are going to find a lot of beachfront hotel and hospitality developments. This is what makes Vietnam an attractive destination for condotel products. I think Vietnam has a lot to offer to both developers and buyers of this product, but I do have concerns about the speed in which it is progressing in—it is happening too quickly. The key driver for success and sustainability in this market is transparency. Developers need to be very open with buyers to make sure they are clear on both the risks associated and the rewards of these types of … [Read more...] about Condotel—the future of the real estate industry
To street vendors in Vietnam’s biggest cities, sidewalk is a lifeline
A new day starts at 2:30 a.m. for Hiep and her four housemates who rent a small apartment tucked away down a Saigon alley. They need to make tofu pudding in time for 6 a.m., when they loads pots full of the hot dessert onto their bicycles and off they go to the inner city to find customers. At the same time, around 1,800 kilometers (1,100 miles) north, Quyen loads duck embryos and chicken eggs onto the back of a motorbike and travels from the outskirts of Hanoi to the Old Quarter in the downtown district of Hoan Kiem. Everyday, tens of thousands of vendors leave their rented apartments in big cities for busy streets to pay off debts and keep their families in the countryside afloat. They are the faces behind telling statistics that have been troubling policymakers for years: migrants and unofficial workers. Official government data from 2015 showed that migrants aged between 15 and 59 made up 17.3 percent of the country’s population of 90 million. The majority of them work in the … [Read more...] about To street vendors in Vietnam’s biggest cities, sidewalk is a lifeline
Effective spending required for people’s acceptance of new property tax proposal
The Ministry of Finance has proposed imposing a new tax on people who own property worth VNĐ700 million ($31,000) or more. - Photo vneconomy.vn The Ministry of Finance claims that the 0.4 per cent tax would bring in VNĐ31 trillion ($1.3 billion) per year and help Việt Nam “get in line with regulations on property tax rates in other countries.” But does that get it line with the people? Not likely. Currently, there is no tax on owning a house. Land users must pay an annual non-agriculture land use tax at a progressive rate of 0.03 per cent to 0.15 per cent of the land price per square metre, determined by the state every five years. The proposal means house owners will have to pay a new kind of tax for their house, apart from the land use tax they’re paying now. The finance ministry justified this new tax by saying that data from other countries show that the lowest property tax rate stands at 0.2 per cent, which makes Việt Nam’s tax rate … [Read more...] about Effective spending required for people’s acceptance of new property tax proposal
Authorities told to apologise to consumers in petrol price error
Nguyen Minh Phong from the Hanoi Socio-economic Development Institute has called on the government to compensate the public who have been paying high petrol prices due to lax management that led to tax difference. Authorities told to apologise to consumers Diesel import taxes for products imported from ASEAN countries were cut to 5% in 2015 and to 0% from 2016 in accordance with ASEAN Trade in Goods Agreement. But Circular 78 issued by the Ministry of Finance and the Ministry of Industry and Trade in last May stated that the import tax for diesel and mazut stood at 10%. That means wholesalers imported their products at a lower tax rate but the customers continued to pay higher tax rates. The Korea-Vietnam Free Trade Agreement, which took effect in December 2015, reduced the import taxes for products from South Korea to 10%, instead of the 20% for products imported from Singapore or Malaysia. Yet retail prices did not reflect that change. Economist Nguyen Minh … [Read more...] about Authorities told to apologise to consumers in petrol price error
Transfer pricing claimed to partly cause FIE losses
Mong Binh - The Saigon Times Daily “Our statistics showed over 60% of the FIEs in the city posted losses last year,” Huong said in response to a question about the reasons why many FIEs have been making for years while Vietnamese firms of same sizes have been profitable at home and abroad. The global economic downturn, Huong said, made life tougher for businesses in Vietnam in 2009, leading many of them to fall into the red. The Vietnamese Government took action by providing businesses with tax breaks and deferral to help them out of tough times. But some multinationals are believed to take advantage of transfer pricing as an illegitimate and immoral means to shift their revenues and profits to the markets where taxes are lower than in Vietnam. Huong claimed a number of FIEs imported machines and materials from the parent company at high prices but sold the finished products they produced in Vietnam at prices lower than normal market levels. “So their losses are … [Read more...] about Transfer pricing claimed to partly cause FIE losses